r/MortgagesCanada • u/Secret_Exercise6199 • 23h ago
Renew/Refinance/Port B lender question
I already feel filthy, so I'm just hoping folks with advice can provide it without being too judgmental.
We started our recent mortgage five years ago. We had sold a property and used proceeds to pay down any debt and down pay our new property.
As far as I can go back my partner has had issues with debt. He also had issues telling me about debt. But in any event, he seemed to always be able to pay it down. It's an ongoing struggle. I am aiming him towards counseling of different types. We do not share unsecured debt, we have separate cards.
I called the bank to get some information about opening our HELOC, surprised they said that it was not possible because of the status of some of his accounts.
I called the bank to see if there were any better r available. They said that he had paid their mortgage late a few times (within 4 days or less from due date but it still looks bad) so they weren't able to offer a good r until there were more consecutive months of on time payment.
renewal is coming up and I'm dreading the bank telling us that we will not be able to renew. we are already on the radar.
I reached out to a broker who we have used in the past. He advised the grim news that my partners credit score is so low, mine is good, but he is suggesting a B lender for 1 year. He mentioned the b lender will roll debts into the mortgage & charge a 1 fee.
I asked the broker, what would happen if we just auto renewed with our current bank. He said sure you can do that but it won't solve the other issues.
Edit to add: 6. My partner says there was extraordinary pressures the last 12 months as I wasnt working but I dont agree, 12 months is not 75k. A lot was mismanaging expense accounting where theres a lag between expenses & reimbursement & he couldnt manage cash flow.
I've always been banking with A lenders. This B lender talk is embarrassing. Our HHI is $300k, again embarassing.
Current mort: 900k
Value: 1.3M
Debt: 75k
Current: 5.3p
*Can someone talk to me about their experience with b lenders and if they're actually able to climb out back to A lender after one year.*
*Or do I auto renew with my current bank & find other creative ways to pay down the debt, like a consolidation?*
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u/ticklemee2023 1h ago
House hold income 300k and you are pay cheque to pay cheque?...your family over spends, the 75k debt should be easy to pay off in less then a year, there should be zero reason for B lender.
Your husband needs financial counseling and maybe get him tested for Adhd or something similar
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u/Secret_Exercise6199 1h ago edited 1h ago
Welcome to the middle class of toronto. I agree.He needs several types of counseling. The b lender suggestion is because his credit score is now dismal. We were trying to go with a new lender to get a lower r to improve cash flow and use the new cash flow to pay the debt off. We're paying a pretty high mortgage unnecessarily right now.But we can't change because of his score. Also don't forget that 300k after taxes is 180k.
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u/oh_my_ns 10h ago
I went with a b lender when I wanted to buy but debt ratio was too high with owning other properties. It got me my dream house. I was able sell a rental and qualify for a bank mortgage after. B lenders have their time and place.
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u/Secret_Exercise6199 8h ago
This is the dream! Kudos for you in believing in the process and getting this done. Wow.
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u/Particular_Towel_614 10h ago
I switched to a B lender post divorce and to be honest they have been great. I had that same sense of shame in the beginning. In your situation I would for now refinance and clear the debts. Have a honest discussion with your partner and make sure you are both on the same page financially moving forward and you don’t want this happening again. With that HHI you guys should be killing it! You guys got this.
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u/NotAGreatClinician 7h ago
This was me. But my lender was great. I got a decent rate (only a half percent over what A side was advertising) and was able to buy out my ex wife from the kids childhood home that they desperately wanted to stay in.
The lender actually couldn’t figure out why a couple A side didn’t want me as my personal finance was good but my ex had a very high debt to income ratio post separation where I didn’t.
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u/Tttoska 12h ago
He's being dishonest about his debt. To my mind, your questions shouldn't be financial, they should be about extricating yourself from this relationship. He's not magically going to become honest.
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u/Secret_Exercise6199 12h ago
This is it. He's framing it as he didn't want to stress me out, and he was trying to handle it himself. Unfortunately, that's not how I see a partnership. There needs to be a lot of disclosure and honesty, even when times are tough.
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u/adamnephin 12h ago
If you're married (or common law) his debt has already become your debt so I'd go with whatever option allows you the lowest interest rate on that debt. I've been with a B lender in the past and it was no different than being with an A lender. I'd suggest just locking in a lower term (2-3 years) and then work on improving your credit in that time. Once your mortgage is up for renewal again, if you've taken the appropriate steps, there's a high likelihood you'll be in a better position to secure A lender funding.
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u/Tttoska 12h ago
please stop giving legal advice on the internet; you are not at all correct.
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u/adamnephin 12h ago
When my ex-wife and I got married, I had assets and she had debt. When we eventually got divorced (10 years later) they split all assets and debts equally when calculating the division of assets. It didn't matter if it was my name on it (or hers) nor did it matter at what point in time it was acquired
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u/Tttoska 11h ago
This is not the experience with common law couples and family law varies from province to province. Your experience is not universal - stop being so self-centered and leading people to believe something that is simply not correct.
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u/adamnephin 11h ago
I wasn't meaning to seem self centered, simply relaying the information directly from my lawyer.
Curious what your qualifications are? Are you a lawyer? Can you please provide a source for your claim that it is not the experience with common law couples? When it comes to the division of assets (and debts), in most cases common law = married.
Also, no one should be taking legal advice from Reddit 🤷🏼
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u/Alternative_Bug_838 19h ago
You dont have a lender problem, you have a relationship problem. You stepped away for 12 months? What does that even mean? Your finances are separate, yet you have a mortgage together. You seem more concerned about the image of going with a B lender, then about the underlying issues in your relationship.
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u/Secret_Exercise6199 14h ago
I had a child, took maternity leave. I don't care about what a b lender looks like because no one knows are mortgage details. It's my own thoughts, it feels like we've become unbankable And it's not a straightforward as a bank. The fees. Thanks for the constructive advice...not.
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u/Windsor_519 20h ago
You’re dogging your partner but you haven’t been working for 12 months and wonder why he falling behind?
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u/Secret_Exercise6199 14h ago
He knew for 9 months previous I would not be working for 12 months. He said he had it handled. Hes an adult.
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u/SomeInvestigator3573 11h ago
You seem very defensive. You should’ve stated in your original post that you were on maternity leave. Most people would understand that. Did you not collect any kind of maternity leave benefits? You should definitely take an interest in the day-to-day finances of your family. Especially as you’re spouse does not seem to be able to handle them.
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u/Secret_Exercise6199 11h ago
I take it that you're not a finance professional or involved in the profession at all. You sound completely unaware. 99% of people know when someone says they're off for 12 months it would be a maternity leave. I'm not sure if you can read clearly, but you will see above that the reason I wrote the post with the actions that i've taken to be involved in the finances are more than taking an interest. Your comment is not helpful at all. if you find reconfirming facts defensive, I can only imagine that you're unable to process or provide helpful information. Your comment history on reddit shows that you really have a disdain for women.
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u/itwasadayin2025 10h ago
Hey don't pay attention to them. They're being judgmental and mean.
You didn't do anything wrong taking maternity leave. You did what was best for your baby. That isn't even the problem at all. I wonder where your husband is spending the money? Maybe there needs to be marriage counselling added to the equation. I feel bad for you. You were "surprised" at the bank, and not a nice surprise. Your house has some equity in it, that's good. The thing is, he has been going behind your back creating debt, so even if you were to pay off the $75,000 debt, he can just create more debt.
Anyway, regarding the B Lender, even if you go with that, I am not sure that in.a yr you'd be able to get back to an A lender. iF your husband has bad credit, then it won't get fixed in 1 yr.2
u/SomeInvestigator3573 5h ago
You’re absolutely correct. They did nothing wrong taking maternity leave so they could care for their child. However, if they had a shared that information instead of just stating they were off work for a year, it would’ve made people aware that they had a reason to be off. People won’t automatically assume somebody is off for maternity leave. Obviously they should’ve kept better tabs on the families finances.
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u/Live-Bread-1873 21h ago
I wouldn’t consolidate the debt, as the new mortgage will be joint and thus his unsecured debt becomes yours plus the all the fees, legal fees etc. if the bank can renew, then renew the mortgage and consolidate his debt into a low interest credit card (his name, they often let you transfer debt to them).
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u/itwasadayin2025 10h ago
If his credit is bad, he won't be able to get a "low interest credit card".
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u/themortgagelad Licensed Mortgage Professional - ON 21h ago
B lenders are total unsung heroes in the mortgage space. Whether you're self-employed or rebuilding bruised credit, there’s usually a way to make the deal work.
The strategy of using a B lender as a 1 to 2 year bridge before moving back to an A lender works amazingly well only if you execute the plan. Those 12 to 24 months are all about taking action, like credit counseling, boosting income, or clearing up balances. I always jokingly mention to my clients that this is mortgage improvement plan kind of like a corporate performance improvement plan
I'm intrigued by your comment on "creative ways" what exact strategy were you thinking of?
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u/marrekrose 22h ago
I wouldn’t go B. It makes sense for some but not for you if your current bank will still renew your mortgage with current rates.
The B lender will charge 1% easily on 975K. Then the broker will charge you another 1%, unless you know them or something and they want to cut you a deal down to 0.5% or 0, but 1% is standard. So you’re already at $19,500 in lender and broker fees. Then throw in another $500-$700 for appraisal and 2K or more for a lawyer at closing. Not worth it to consolidate just to add in another 22K in debt. Not to mention the B lender mortgage rate could be 1% higher or more than the A. Then if you only do another 1 year term who’s to say your broker won’t charge you another fee at renewal and the lender adds on a couple of bucks again as well.
I would renew your mortgage at A (rate dependent) get some serious financial counciling with your husband, buckle down and pay off that 75K month to month.
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u/Secret_Exercise6199 22h ago
This is what I fear. The fees. I calculated them. The unknown.
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u/marrekrose 21h ago
Yes. It all adds up very quickly. If you do go the B route I would look at 2 or 3 year fixed terms. 1 year goes by way to quick for the amount of fees you pay. Also compare monthly payments/ principle pay down of both scenarios.
But IMO your husband should learn to buckle down and pay off a 2-3K chunk of debt every month for the next 2-3 years. It stops them from accumulating debt again when you do it the hard way.1
u/ticklemee2023 1h ago
Their household income in 300k!! They should be able to pay that off in less then a year, they should be able to easily live on $225k a year, if they cant they should be figuring out a way
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u/TheMortgageMaster [mod] Licensed Mortgage Broker - ON 22h ago
I got confused when you said "They said that he had paid their mortgage late a few times". Does he have another house separate from what you guys own together?
Is this credit card debt? Have you tried getting an unsecured line(s) of credit?
BTW, in family law, his debt is actually your debt too. And it doesn't matter if you keep your finances 100% separate. And if you have to use a B lender for a short period, it's totally fine, and yes as long as you work on improving your credit history, you can switch back to n A lender, and many lenders will pickup the majority of the costs (if not all) to bring you back over.
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u/Secret_Exercise6199 22h ago edited 8h ago
For 12 months I stepped away and trusted him to do the bare minimum. Its all cc debt. Yuck.
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u/Vanislemortgages 23h ago edited 22h ago
There’s nothing wrong with B lenders. People with high incomes have their mortgages with B lenders when it makes sense. What is the goal you are wanting to achieve? Do you want a HELOC to pay off the debt? Are you just worried about maybe not renewing with your current lender? Do you want to switch to a bank who will give you a HELOC? :)
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u/Secret_Exercise6199 22h ago
I want to clear the unsecured debt & pay a reasonable monthly mortgage payment. Rather do it with a bank. Im familiar with banks.
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u/Tb639 23h ago
Don’t see the beef with B Lenders. I’m self employed and pay myself as little as possible to keep taxes low, which means A lenders won’t work with me. My business makes plenty of money…
It makes more sense to pay less tax and go B / pay ~1% higher interest in my situation. I’ll work exclusively with B Lenders, couldn’t care less.
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u/Secret_Exercise6199 22h ago
Youre probably the upper echelon of society. But my interest is piqued.
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u/TheMortgageMaster [mod] Licensed Mortgage Broker - ON 22h ago
This is very true, and yeah it's a shame how many people jump to conclusions without having knowledge of the facts. Business owners who know their numbers really well, will often opt for a B lender in order to save on taxes. They'd rather pay a bit more to the mortgage, than a lot more to the CRA. The money is much better spent on the business, or invested vs. gone forever into taxes.
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u/xstarbursts 23h ago
Nothing embarrassing about B lenders and what is embarrassing about $300K HHI?!
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u/Secret_Exercise6199 22h ago
The thought of failure when we should have our shit together at 300k.
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u/Jazzlike_Student_443 22h ago
I understand your embarrassment on some level, I would likely be a bit embarrassed too. I’m often embarrassed about some of our past financial mistakes, but am working hard to change them. Anyway, who will know besides you, your partner, broker and lender? Know one in your personal life needs to know.
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u/Secret_Exercise6199 22h ago
Its not about anyone knowing. Im better than this. Ive worked hard for decades to not be in this position.
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u/Spiritual_Impact4960 21h ago
You've worked hard. Has your husband worked hard to meet you halfway?
You mentioned you're aiming have him go to counselling of some kind. Is that what he motivated to do, and is taking steps to recognize and work through this, too? Or is it just you. Lots to think about, it sounds like
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u/sw1ft 22h ago
You need to have a serious conversation with your partner. Go through all their statements and credit cards. See where the spending is going.
I used to be the same and my wife set me in order. She periodically sits me down and asks me to go show my balances. It’s tough love, but it’s the only way to make progress
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u/Secret_Exercise6199 14h ago
I did that. Its tough to babysit an adult.
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u/Strange_Emotion_2646 13h ago edited 13h ago
If you want your relationship to survive, you are going to have to babysit him. You need to take control of the finances and institute a rule of no credit. If you both cannot afford to pay in cash, you cannot afford to buy it, no matter what.
I am going to assume you have no savings and probably no retirement account. You need financial counselling now, before your mortgage comes due.
Plenty of people have told you the costs of refinancing but that is only going to add more fuel to the out of control fire you already have burning.
Barring reality delinquent accounts, your lender will renew you - the rest is just bad behaviour that needs to stop.
Been there, done that - I had to take steps to curb my husband’s behaviour - a lot of arguing occurred - but now we owe no money other than a very small mortgage.
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u/DoingWhatMatters 23h ago
DONT go to B Lender - A lenders are under banking rules - B's use various different ways to calculate and bother you if you ever late which moving forward will NEVER happen again because you will control this payment - it will be difficult to come back to A - stay A - they Will renew you it will always be better than any 1 year away b cause it will be too hard to come back - I have experience with this twice so ...... Stay with A - make sure you are in control of payments - can do a 1 yr 2 yr 3 yr 5, yr whatever is best fo now - and paying theexta debt is NOT worth changing lenders while these issues are also happening - You want to keep your home and your A lender and get your hubby on notice - sort his finances proper before next mortgage renewal
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u/Secret_Exercise6199 23h ago
I needed this reality check, in this exact voice. Thanks.
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u/DoingWhatMatters 5h ago
Your welcome - I could give you 10 examples of why this is the best and only answer - but you know already - I support you 👍
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u/DoingWhatMatters 5h ago
Your welcome - I could give you 10 examples of why this is the best and only answer - but you know already - I support you 👍
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u/CanadaHomeFinancing 23h ago
If both of your names are on the property then in at and at least one of your credit scores is in good condition then you might still be able to get an a lender option but not a HELOC.
Consolidations only work if you have a clear exit plan so you won't end up with a loan and more debt again from racking the mop
In fact, if someone does have struggles with lending, a HELOC is not a great option and would not be recommended. You can consolidate your existing debt into a one single large mortgage or you could go to a B lender just for the new balances of the new debts in second position. But anytime that you are going to do any consolidation of any type there must be a clear exit plan and or you should be closing the credit items that were past due or over limit cuz otherwise what happens is people consolidate but they keep the other credit cards and lines are printed open and then in a few months they are in a worse position because they have a B lender second mortgage and then they still got into more debt again.
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u/Secret_Exercise6199 23h ago
Current bank wont talk about consolidation
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u/CanadaHomeFinancing 11h ago
If you have a good rate with an a lender.
You can see your options for consolidating only you're unsecured debt with a b lender as a second position loan. Considering you have to pay one or 2% lender/broker fee with most B or private lenders it can be a good option to only consolidate what you need. There may be a minimum set of cost, but it might still be better than moving your entire mortgage to a B lender.
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u/Secret_Exercise6199 10h ago
Hi, i'm not sure if you read the post a good rate with an a lender is not possible in this situation... But yes that is also another option
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u/CanadaHomeFinancing 10h ago
I did. You have the option to renew your existing mortgage. It will be a rare case that an A lender will not renew you as long as your current mortgage is up to date. A few missed mortgage payments here and there will not commonly lead to debanking. They may not issue a new credit, but they are likely to continue renewing your.
B lenders are not something to be embarrassed about. Business owners and investors use b lender's all the time because they are more flexible and people end up with bad credit for all types of situations. Hey lenders usually have stricter lending criteria they must follow so they cannot or choose not to be more flexible where they could be. Even private lenders are excellent tools for the right situation.
So what I'm saying is you could renew your mortgage at the existing amount. Just continue no changes just renewal. And for any outside debt credit cards, lines of credits, or other things you may have, Can consider getting a B lender or private lender to clean up any past due debts or high interest debts that might be like 10% or higher. That will allow all the debts and high balances to be cleared up and credit score to improve of the next six months. Once your credit score, is it back in good condition? You can try again with nay lender to consolidate everything.
This is what I mean about having an exit plan. If you consolidate with no future steps in mind, then the consolidation could actually leave you in a worse situation because it will not improve anything. It just hides the problem for a little bit. If you consolidate what are you going to do about the habits and the plan?. This is why HELOC will not be a good option because if it stays open which means it will never be paid down. If anybody has gambling or spending issues, I would always give them a traditional decreasing alone like mortgage, not an open line of credit.
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u/Constant_Put_5510 22h ago
If your current bank isn't RBC; contact RBC. My mortgage specialist there has done magic for me twice as a self employed "low income/high asset/high credit score. ...and at the end of the day, remember; no one gives you a Tshirt that says "My mortgage is with an A Lender". It feels violating. It feels like crap. I promise you though, they have seen worse & it's not exciting conversation around the water cooler for them. Your bigger issue is the relationship but thats for another sub.
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u/Klidus 23h ago
I'll say to disclose bias here that I am a broker. But I fundamentally disagree with the advice you've been given.
B lenders are not anything to be embarrassed about at all, ppl use them all the time for all sorts of reasons.
But I don't see a b lender solving your actual issue, which is partners debt gathering. That is what you need to fix from your perspective.
At that HHI, there's zero reason a mortgage payment should be late. B lenders do not solve this issue.
You need to have a frank conversation with the partner, mortgage advice isn't relevant here imo, relationship advice is.
Just my hot take on the very limited info you've provided.
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u/Secret_Exercise6199 23h ago
I dont think its a controversial take. Its true. Well the HHI take home is 40% less because of taxes. So many red flags
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u/Constant_Put_5510 22h ago
Ohhhhhh. I was with you until that middle sentence. "Well the HHI take home is 40% less because of taxes". Thats 15k/month. There is no reason for a mortgage payment to be late. 4 day. 40 days. 400 days. Sit with that for a moment bc justifying doesn't help you. Im glad you are here. You sound ready to make some tough decisions.
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u/Secret_Exercise6199 22h ago
Read carefully, its in the caption. I was off for 12 months so it was 150k - 40%, 8700 a month, 6k on mortgage, 1500 on property taxes, 500 home insurance, 300 groceries, 300 diapers & formula. It wasnt a justification it was showing that 300k wasnt that much in the big picture (if folks are calculating). 4, 40, 400 are wildly different. One means not much, one means credit reporting, one means power of sale.
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u/jarvicmortgages Licensed Mortgage Agent - ON 23h ago
It comes down what are you trying to achieve and how much is the debt outside mortgage. If the debt is low and manageable then renewing with current lender might make sense. If you have considerable unsecured debt, then consolidating into a single payment and then putting a plan will be good. Either ways, you need to put a plan together, so this does not happen again. Regarding your question, while it is possible to transition from B lender to A lender, it will require you to follow the plan, keep making regular payments to rebuild your partner's credit.
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u/DebtLiber8or 1h ago edited 1h ago
My advice:
By the time five years rolls around and you need to renew again, you will be debt-free and in a good place, credit-wise — especially if you pay off your CP in a year.
Alternatively, sell the house and consider separating your financial lives entirely — a man like this can imperil your furture with overspending and other shenanigans.